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Incentive for Disabled Worker Retention Suggested

Can the unsustainable increase in the number of people receiving Social Security Disability Insurance benefits be slowed if employers get incentives to keep workers with disabilities on the payroll?

The cost of the Social Security Disability Insurance program has gone from $40 billion in 1989 to $121 billion in 2009.

Approximately 10 percent of the job population reported disabilities in both 1989 and 2009, yet enrollment in SSDI has increased as working age adults who receive the benefits has doubled to 4.6 percent.

Declining rewards for most skilled workers may be behind increase of the disabled workers who are applying for benefits. As their jobs are disappearing, people with disabilities are applying for Social Security Disability Insurance benefits. Half of all disability applicants will eventually be approved for the program.

The Brookings institution’s Hamilton Project and the Center for American Progress suggests that if the government created incentives the employers would keep disabled workers on the payroll. Their suggestion is that workers and employers each share the premiums of private disability insurance. The private disability insurance packages run between 150 and $250 a year.

Approval for new benefits for a private policy would be required before workers could go into the Federal disability program. Partial income support money that would help with rehabilitation services and other services would be paid by these benefits.

Once a worker got two years of the private payments they could apply for Social Security disability insurance if they are still unable to work.